Germany's inflation rate hits lowest since June '21 at 2.9% in Jan '24

03 Feb '24

1 min read

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Insights

Germany's inflation rate is expected to hit a low of 2.9 per cent in January 2024, the lowest since June 2021.
Consumer prices may rise by 0.2 per cent from December 2023, with core inflation at 3.4 per cent.
Energy prices dropped by 2.8 per cent YoY.
The HICP shows a 3.1 per cent YoY increase and a provisional 0.2 per cent monthly decrease.

Germany is witnessing its lowest inflation rate since June 2021, with a projected rate of 2.9 per cent for January 2024, according to the Federal Statistical Office (Destatis). This decrease marks a significant moment, with inflation rates having not seen this low since the 2.4 per cent recorded nearly three years ago.

Consumer prices are expected to see a modest increase of 0.2 per cent from December 2023 to January 2024. The core inflation rate, which excludes volatile food and energy prices, is projected to be higher at 3.4 per cent.

Despite the termination of the energy price brake, which was implemented to mitigate the cost of fossil fuels, energy prices in January 2024 are expected to be 2.8 per cent lower than in the same month the previous year. This decline in energy prices contributes to the overall reduction in the inflation rate, as per Destatis.

The harmonised index of consumer prices (HICP) for January 2024 shows a year-on-year (YoY) increase of 3.1 per cent, with a provisional decrease of 0.2 per cent compared to the previous month.

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